​When to take Legal Advice – A Key Issue for Small and Medium Sized Charities

​When to take Legal Advice – A Key Issue for Small and Medium Sized Charities

Large charities will have "in-house Counsel" that will give direct legal advice to charities on a day to day basis. For the majority of smaller charities they may have lawyers or other professionals on their Board but are likely to come across situations where they have to decide whether to take legal advice and incur the cost of doing this. When is the right time?

As part of a trustee's role and responsibilities a trustee must act in the best interest of a charity and act with reasonable care and skill. Very often this amounts to identifying when a legal issue arises and to take independent legal advice. For example for a charity that does not have its own HR Manager but employs staff very often employment law issues are vital ones that need to be addressed before during and after employing a member of staff to avoid the risk of a claim being made. Charities because of their status are not insulated or immune from claims being made by employees or indeed claims being made against the charity by third parties for breach of contract or negligence. Being a charity does not give a "get out of jail free card" on liability.

There may be a Solicitor or Barrister on the Board of a charity. They have to be particularly careful in that section 1 of the Trustee Act 2000 which is used as the basis for the Charity Commission Guidance does in fact put a higher burden on them to be aware of potential legal issues and when the charity should be taking professional advice. This states:

"Whenever the duty of care applies to a trustee he must exercise such care and skill as is reasonable in the circumstances having regard in particular to any special knowledge or experience that he has or holds himself out as having".

The danger for a trustee that is a professional such as a Solicitor is that he or she will be held to a higher level of expectation based on their "special" knowledge or experience and that in itself can make professionals reluctant to become trustees. Very often as part of the recruitment of trustees a charity will need to have in mind a balance of skills and ideally having a Solicitor or Barrister with some background legal knowledge will be of great assistance even if that is just identifying when independent advice from a Solicitor is necessary. Of course charities need to manage resources responsibly and it is therefore common practice for charities to carry out a due diligence process with the instruction of a Solicitor whether that be an ongoing relationship or to deal with one piece of advice or work that is needed.

We offer a full range of legal services to our clients from the Charity sector, please see our dedicated webpage on our legal services for Charities for more information. Contact us today on 01603 693500 or email us using the 'Make an enquiry' form. Appointments available at our Norwich, North Walsham, Brooke and Sheringham offices.